House Bill 815

AN ACT TO AMEND SECTION 25-53-111, MISSISSIPPI CODE OF 1972,
TO REQUIRE THE MISSISSIPPI DEPARTMENT OF INFORMATION TECHNOLOGY SERVICES TO
APPROVE CONTRACTS BY STATE AGENCIES FOR THE PROCUREMENT OF CELLULAR TELEPHONES;
TO AMEND SECTION 25-53-121, MISSISSIPPI CODE OF 1972, TO REQUIRE THE
MISSISSIPPI DEPARTMENT OF INFORMATION TECHNOLOGY SERVICES TO DEVELOP A LIST OF
VENDORS TO PROVIDE CELLULAR TELEPHONE SERVICES TO STATE AGENCIES; TO AMEND
SECTION 31-7-13, MISSISSIPPI CODE OF 1972, TO REQUIRE THAT CONTRACTS BY
GOVERNING AUTHORITIES FOR THE PROCUREMENT OF CELLULAR TELEPHONE SERVICE BE
ACCEPTED ON THE BASIS OF THE LOWEST AND BEST BID; AND FOR RELATED PURPOSES.

25-53-111.
The Mississippi Department of Information Technology Services
shall have the following additional duties:

(a)
To establish and coordinate through either state ownership or commercial
leasing, all telecommunications systems and services affecting the management
and operations of the state.

(b)
To act as the sole centralized customer for the acquisition, billing and
record keeping of all telecommunications systems or services provided to state
agencies whether obtained through lease or purchase.

(c)
To charge respective user agencies for their proportionate cost of the
installation, maintenance and operation of the telecommunications systems and
services, including the operation of the bureau.

(d)
To offer or provide transmission, switch and network services on a
reimbursable basis to agencies financed entirely by federal funds, to governing
authorities and to other governmental agencies.

(e)
To approve or provide state telephone services on a reimbursable basis
to full-time students at state institutions of higher learning and junior
colleges, including where such services are provided by the state or the
institution.

(f)
To develop coordinated telecommunications systems or services within and
among all state agencies and require, where appropriate, cooperative
utilization of telecommunications equipment and services by aggregating
users. Where such cooperative
utilization of telecommunications system or service would affect an agency
authorized to receive information from the National Crime Information Center of
the Federal Bureau of Investigation, such plans for cooperative utilization
shall first be approved by the National Crime Information Center before
implementation of such telecommunications systems or service can proceed.

(g)
To review, coordinate, approve or disapprove all requests by state
agencies for the procurement, through purchase or contract for lease of
telecommunications systems, cellular telephone services or services including
telecommunication proposals, studies and consultation contracts and intra-LATA
and inter-LATA transmission channels.

(h)
To establish and define telecommunications systems and services
specifications and designs so as to assure compatibility of telecommunications
systems and services within state government and governing authorities.

(i)
To provide a continuous, comprehensive analysis and inventory of
telecommunications costs, facilities and systems within state government.

(j)
To promote, coordinate or assist in the design and engineering of
emergency telecommunications systems, including but not limited to
"911" service, emergency medical services and other emergency
telecommunications services.

(k)
To advise and provide consultation to agencies and governing authorities
with respect to telecommunications management planning and related matters and
to provide training to users within state government in telecommunications
technology and system use.

(l)
To develop policies, procedures and long-range plans, consistent with
the protection of citizens' rights to privacy and access to information, for
the acquisition and use of telecommunications systems, and to base such
policies on current information about state telecommunications activities in
relation to the full range of emerging technologies.

State agencies shall use a vendor chosen by the Department of
Information Technology Services for the procurement of cellular telephone
services. Any state agency
requesting an increase in expenditure of funds for new telecommunications
equipment systems or services shall submit to the Legislative Budget Office
with its budget request preceding the fiscal year for which funding is
requested detailed justification for such request. The justification shall be provided on forms developed by the Mississippi
Department of Information Technology Services in accordance with the
Administrative Procedure Act. In
addition, all state agencies shall submit to the bureau, when requested, a long-range
plan for use of telecommunications equipment, systems and services.

25-53-121.
(1) The types of contracts
permitted in the procurement of telecommunications equipment, systems and
related services are defined herein, and the provision in Sections 25-53-101
through 25-53-125 supplement the provisions of Chapter 7, Title 31, Mississippi
Code of 1972.

(2)
The Mississippi Department of Information Technology Services may, on
behalf of any state agency, enter into an equipment support contract with a
vendor of telecommunications equipment or services for the purchase or lease of
such equipment or services in accordance with the following provisions:

(a)
Specifications for equipment support contracts shall be developed in
advance and shall conform to the following requirements:

(i) Specifications for equipment support contracts shall cover a
specific class or classes of equipment and service and may include all features
associated with that class or classes.

(ii) Specifications in the request for proposals for equipment support
contracts shall be developed by the Mississippi Department of Information
Technology Services.

(iii) Specifications shall be based on the projected needs of user
agencies.

(iv) Specifications for equipment support contracts for purchase or
lease of telecommunications equipment may include specifications for the
maintenance of the equipment desired.

(b)
The initial procurement of an equipment support contract, and
procurement of equipment and services to be utilized by agencies under an
equipment support contract, shall be as follows:

(ii) A using agency may procure required telecommunications equipment
and service available under an equipment support contract through release of a
purchase order for the required equipment and service to the vendor holding an
equipment support contract. However,
such procurement by purchase order shall be accomplished in accordance with the
procedures and regulations prescribed by the Mississippi Department of
Information Technology Services, and shall be subject to all other statutory
requirements including approval by the bureau.

(c)
The final authority for entering into equipment support contracts shall
rest with the Mississippi Department of Information Technology Services,
and such contracts shall be executed by the Mississippi Department of
Information Technology Services in accordance with the procedures and
regulations defined by said authority.

(d)
Equipment support contracts shall include the following terms and
conditions:

(i) Equipment support contracts shall be valid for not more than one
(1) fiscal year with the Mississippi Department of Information Technology
Services having an option to renew for two (2) additional fiscal years. The vendor may vary lease or purchase prices
for the optional renewal period(s) by an amount equal to the lesser of the lease
or purchase price permitted by that vendor's contract with the General Services
Administration of the United States government for such equipment and services,
or any variance in that vendor's published list prices for such equipment and
services during that fiscal year, provided that any increase may not exceed
five percent (5%) and the variance must have been authorized by the initial
equipment and service order contract.

(ii) The prices stated in such contract shall not change for the
period of the contract.

(iii) Individual items of telecommunications equipment and service
which may be included under an equipment support contract may not have a
purchase price greater than Fifty Thousand Dollars ($50,000.00) or a monthly
lease price greater than Three Thousand Dollars ($3,000.00). Such price shall not include costs of
maintenance, taxes or transportation.

(iv) Equipment support contracts shall include the following annual
appropriation dependency clause:

"The continuation of this contract is
contingent upon the appropriation of funds to fulfill the requirements of the
contract by the Legislature. If the
Legislature fails to appropriate sufficient monies to provide for the
continuance of the contract, the contract shall terminate on the date of the
beginning of the first fiscal year for which funds are not appropriated."

(3)
The Mississippi Department of Information Technology Services may on
behalf of any state agency enter into contracts for the lease or purchase of
telecommunications equipment systems or services in accordance with the
following provisions:

(a)
The Mississippi Department of Information Technology Services may
directly contract for or approve contracts for regulated or tariffed
telecommunications services upon determination by the bureau that the
application of such service is in the best interests of the State of
Mississippi.

(b)
All other contracts of this type shall be entered into through request
for proposals as defined in Sections 25-53-101 through 25-53-125.

(c)
The justification of such contracts must be presented to the bureau
prior to issuance of a request for proposals.
Such justification shall identify and consider all cost factors relevant
to that contract.

(d)
The term of a lease contract shall not exceed sixty (60) months for a
system lease valued less than One Million Dollars ($1,000,000.00) and shall not
exceed one hundred twenty (120) months for a system lease valued One Million
Dollars ($1,000,000.00) or more.

(e)
All lease contracts must contain the following annual appropriation
dependency clause:

"The continuation of this contract is
contingent upon the appropriation of funds to fulfill the requirements of the
contract by the Legislature. If the
Legislature fails to appropriate sufficient monies to provide for the
continuation of a contract, the contract shall terminate on the date of the
beginning of the first fiscal year for which funds are not appropriated."

(f)
The Mississippi Department of Information Technology Services shall maintain
a list of all such contracts. This list
shall show as a minimum the name of the vendor, the annual cost of each
contract and the term of the contract or the purchase cost.

(g)
Upon the advance written approval of the bureau, state agencies may extend
contracts for the lease of telecommunications equipment, systems and related
services on a month-to-month basis for a period not to extend more than one (1)
calendar year for the stated lease prices.

(h) With respect to the procurement of cellular telephone services,
the Department of Information Technology Services shall develop a list of
approved vendors for the delivery of those services to state agencies. The department may exercise the option of
selecting one (1) vendor to provide the services, or if it deems such to be
most advantageous to the state, it may select multiple vendors. If it chooses to utilize multiple vendors,
the department may select vendors on the basis of the lowest and best bid proposals,
or it may establish a state contract per minute price and allow any vendor who
agrees to provide service at the contract price to be added to the list of
vendors.

No agency shall contract for cellular
telephone services with any vendor unless the vendor has been approved by the
Department of Information Technology Services.

31-7-13.
All agencies and governing authorities shall purchase their commodities
and printing; contract for garbage collection or disposal; contract for solid
waste collection or disposal; contract for sewage collection or disposal;
contract for public construction; contract for cellular telephone services
and contract for rentals as herein provided.

(a)
Bidding procedure for purchases
not over $3,500.00. Purchases,
except contracts for cellular telephone services, which do not involve an
expenditure of more than Three Thousand Five Hundred Dollars ($3,500.00),
exclusive of freight or shipping charges, may be made without advertising or otherwise
requesting competitive bids. However, nothing contained in this paragraph
(a) shall be construed to prohibit any agency or governing authority from
establishing procedures which require competitive bids on purchases of Three
Thousand Five Hundred Dollars ($3,500.00) or less.

(b)
Bidding procedure for purchases
over $3,500.00 but not over $15,000.00.
Purchases, except contracts for cellular telephone services,
which involve an expenditure of more than Three Thousand Five Hundred Dollars
($3,500.00) but not more than Fifteen Thousand Dollars ($15,000.00), exclusive
of freight and shipping charges may be made from the lowest and best bidder
without publishing or posting advertisement for bids, provided at least two (2)
competitive written bids have been obtained.
Any governing authority purchasing commodities pursuant to this
paragraph (b) may authorize its purchasing agent, or his designee, with regard
to governing authorities other than counties, or its purchase clerk, or his
designee, with regard to counties, to accept the lowest and best competitive
written bid. Such authorization shall
be made in writing by the governing authority and shall be maintained on file
in the primary office of the agency and recorded in the official minutes of the
governing authority, as appropriate.
The purchasing agent or the purchase clerk, or their designee, as the
case may be, and not the governing authority, shall be liable for any penalties
and/or damages as may be imposed by law for any act or omission of the
purchasing agent or purchase clerk, or their designee, constituting a violation
of law in accepting any bid without approval by the governing authority. The term "competitive written bid"
shall mean a bid submitted on a bid form furnished by the buying agency or
governing authority and signed by authorized personnel representing the vendor,
or a bid submitted on a vendor's letterhead or identifiable bid form and signed
by authorized personnel representing the vendor. "Competitive" shall mean that the bids are developed
based upon comparable identification of the needs and are developed
independently and without knowledge of other bids or prospective bids. Bids may be submitted by facsimile,
electronic mail or other generally accepted method of information
distribution. Bids submitted by
electronic transmission shall not require the signature of the vendor's
representative unless required by agencies or governing authorities.

(c)
Bidding procedure for purchases
over $15,000.00.

(i) Publication requirement. Purchases which involve an expenditure of
more than Fifteen Thousand Dollars ($15,000.00), exclusive of freight and
shipping charges, may be made from the lowest and best bidder after advertising
for competitive sealed bids once each week for two (2) consecutive weeks in a
regular newspaper published in the county or municipality in which such agency
or governing authority is located. The
date as published for the bid opening shall not be less than seven (7) working
days after the last published notice; however, if the purchase involves a
construction project in which the estimated cost is in excess of Fifteen
Thousand Dollars ($15,000.00), such bids shall not be opened in less than
fifteen (15) working days after the last notice is published and the notice for
the purchase of such construction shall be published once each week for two (2)
consecutive weeks. The notice of
intention to let contracts or purchase equipment shall state the time and place
at which bids shall be received, list the contracts to be made or types of
equipment or supplies to be purchased, and, if all plans and/or specifications
are not published, refer to the plans and/or specifications on file. If there is no newspaper published in the
county or municipality, then such notice shall be given by posting same at the
courthouse, or for municipalities at the city hall, and at two (2) other public
places in the county or municipality, and also by publication once each week
for two (2) consecutive weeks in some newspaper having a general circulation in
the county or municipality in the above provided manner. On the same date that the notice is
submitted to the newspaper for publication, the agency or governing authority
involved shall mail written notice to, or provide electronic notification to
the main office of the Mississippi Contract Procurement Center that contains
the same information as that in the published notice.

(ii) Bidding process amendment
procedure. If all plans and/or
specifications are published in the notification, then the plans and/or
specifications may not be amended. If
all plans and/or specifications are not published in the notification, then
amendments to the plans/specifications, bid opening date, bid opening time and
place may be made, provided that the agency or governing authority maintains a
list of all prospective bidders who are known to have received a copy of the
bid documents and all such prospective bidders are sent copies of all
amendments. This notification of
amendments may be made via mail, facsimile, electronic mail or other generally
accepted method of information distribution.
No addendum to bid specifications may be issued within two (2) working
days of the time established for the receipt of bids unless such addendum also
amends the bid opening to a date not less than five (5) working days after the
date of the addendum.

(iii) Filing requirement. In all cases involving governing
authorities, before the notice shall be published or posted, the plans or
specifications for the construction or equipment being sought shall be filed
with the clerk of the board of the governing authority. In addition to these requirements, a bid
file shall be established which shall indicate those vendors to whom such
solicitations and specifications were issued, and such file shall also contain
such information as is pertinent to the bid.

(iv) Specification restrictions. Specifications pertinent to such bidding
shall be written so as not to exclude comparable equipment of domestic
manufacture.However, if
valid justification is presented, the Department of Finance and Administration
or the board of a governing authority may approve a request for specific
equipment necessary to perform a specific job.
Further, such justification, when placed on the minutes of the board of
a governing authority, may serve as authority for that governing authority to
write specifications to require a specific item of equipment needed to perform
a specific job. In addition to these
requirements, from and after July 1, 1990, vendors of relocatable classrooms
and the specifications for the purchase of such relocatable classrooms
published by local school boards shall meet all pertinent regulations of the
State Board of Education, including prior approval of such bid by the State
Department of Education.

(v) Agencies and governing authorities may establish secure
procedures by which bids may be submitted via electronic means.

(d)
Lowest and best bid decision
procedure.

(i) Decision procedure. Purchases may be made from the lowest and
best bidder. In determining the lowest
and best bid, freight and shipping charges shall be included. Life-cycle costing, total cost bids,
warranties, guaranteed buy-back provisions and other relevant provisions may be
included in the best bid calculation.
All best bid procedures for state agencies must be in compliance with
regulations established by the Department of Finance and Administration. If any governing authority accepts a bid
other than the lowest bid actually submitted, it shall place on its minutes
detailed calculations and narrative summary showing that the accepted bid was
determined to be the lowest and best bid, including the dollar amount of the
accepted bid and the dollar amount of the lowest bid. No agency or governing authority shall accept a bid based on
items not included in the specifications.

(ii)Construction project
negotiations authority. If the
lowest and best bid is not more than ten percent (10%) above the amount of
funds allocated for a public construction or renovation project, then the
agency or governing authority shall be permitted to negotiate with the lowest
bidder in order to enter into a contract for an amount not to exceed the funds
allocated.

(iii) Cellular telephone service.
Governing authorities that choose a cellular telephone service shall
choose the service on the basis of the lowest and best bid.

(e)
Lease-purchase authorization. For the purposes of this section, the term
"equipment" shall mean equipment, furniture and, if applicable,
associated software and other applicable direct costs associated with the
acquisition. Any lease-purchase of
equipment which an agency is not required to lease-purchase under the master
lease-purchase program pursuant to Section 31-7-10 and any lease-purchase of
equipment which a governing authority elects to lease-purchase may be acquired
by a lease-purchase agreement under this paragraph (e). Lease-purchase financing may also be
obtained from the vendor or from a third-party source after having solicited
and obtained at least two (2) written competitive bids, as defined in paragraph
(b) of this section, for such financing without advertising for such bids. Solicitation for the bids for financing may
occur before or after acceptance of bids for the purchase of such equipment or,
where no such bids for purchase are required, at any time before the purchase
thereof. No such lease-purchase
agreement shall be for an annual rate of interest which is greater than the
overall maximum interest rate to maturity on general obligation indebtedness
permitted under Section 75-17-101, and the term of such lease-purchase
agreement shall not exceed the useful life of equipment covered thereby as
determined according to the upper limit of the asset depreciation range (ADR)
guidelines for the Class Life Asset Depreciation Range System established by
the Internal Revenue Service pursuant to the United States Internal Revenue
Code and regulations thereunder as in effect on December 31, 1980, or
comparable depreciation guidelines with respect to any equipment not covered by
ADR guidelines. Any lease-purchase
agreement entered into pursuant to this paragraph (e) may contain any of the
terms and conditions which a master lease-purchase agreement may contain under
the provisions of Section 31-7-10(5), and shall contain an annual allocation
dependency clause substantially similar to that set forth in Section 31-7-10(8). Each agency or governing authority entering
into a lease-purchase transaction pursuant to this paragraph (e) shall maintain
with respect to each such lease-purchase transaction the same information as
required to be maintained by the Department of Finance and Administration
pursuant to Section 31-7-10(13).
However, nothing contained in this section shall be construed to permit
agencies to acquire items of equipment with a total acquisition cost in the
aggregate of less than Ten Thousand Dollars ($10,000.00) by a single lease-purchase
transaction. All equipment, and the
purchase thereof by any lessor, acquired by lease-purchase under this paragraph
and all lease-purchase payments with respect thereto shall be exempt from all
Mississippi sales, use and ad valorem taxes.
Interest paid on any lease-purchase agreement under this section shall
be exempt from State of Mississippi income taxation.

(f)
Alternate bid authorization. When necessary to ensure ready availability
of commodities for public works and the timely completion of public projects,
no more than two (2) alternate bids may be accepted by a governing authority
for commodities. No purchases may be
made through use of such alternate bids procedure unless the lowest and best
bidder cannot deliver the commodities contained in his bid. In that event, purchases of such commodities
may be made from one (1) of the bidders whose bid was accepted as an alternate.

(g)
Construction contract change
authorization. In the event a
determination is made by an agency or governing authority after a construction
contract is let that changes or modifications to the original contract are
necessary or would better serve the purpose of the agency or the governing
authority, such agency or governing authority may, in its discretion, order
such changes pertaining to the construction that are necessary under the
circumstances without the necessity of further public bids; provided that such
change shall be made in a commercially reasonable manner and shall not be made
to circumvent the public purchasing statutes.
In addition to any other authorized person, the architect or engineer
hired by an agency or governing authority with respect to any public
construction contract shall have the authority, when granted by an agency or
governing authority, to authorize changes or modifications to the original
contract without the necessity of prior approval of the agency or governing
authority when any such change or modification is less than one percent (1%) of
the total contract amount. The agency
or governing authority may limit the number, manner or frequency of such emergency
changes or modifications.

(h)
Petroleum purchase
alternative. In addition to other
methods of purchasing authorized in this chapter, when any agency or governing
authority shall have a need for gas, diesel fuel, oils and/or other petroleum
products in excess of the amount set forth in paragraph (a) of this section,
such agency or governing authority may purchase the commodity after having
solicited and obtained at least two (2) competitive written bids, as defined in
paragraph (b) of this section. If two
(2) competitive written bids are not obtained, the entity shall comply
with the procedures set forth in paragraph (c) of this section. In the event any agency or governing
authority shall have advertised for bids for the purchase of gas, diesel fuel,
oils and other petroleum products and coal and no acceptable bids can be
obtained, such agency or governing authority is authorized and directed to
enter into any negotiations necessary to secure the lowest and best contract
available for the purchase of such commodities.

(i)
Road construction petroleum
products price adjustment clause authorization. Any agency or governing authority authorized to enter into
contracts for the construction, maintenance, surfacing or repair of highways,
roads or streets, may include in its bid proposal and contract documents a
price adjustment clause with relation to the cost to the contractor, including
taxes, based upon an industry-wide cost index, of petroleum products including
asphalt used in the performance or execution of the contract or in the
production or manufacture of materials for use in such performance. Such industry-wide index shall be
established and published monthly by the Mississippi Department of
Transportation with a copy thereof to be mailed, upon request, to the clerks of
the governing authority of each municipality and the clerks of each board of
supervisors throughout the state. The
price adjustment clause shall be based on the cost of such petroleum products
only and shall not include any additional profit or overhead as part of the
adjustment. The bid proposals or
document contract shall contain the basis and methods of adjusting unit prices
for the change in the cost of such petroleum products.

(j)
State agency emergency purchase
procedure. If the governing board
or the executive head, or his designee, of any agency of the state shall
determine that an emergency exists in regard to the purchase of any commodities
or repair contracts, so that the delay incident to giving opportunity for
competitive bidding would be detrimental to the interests of the state, then
the provisions herein for competitive bidding shall not apply and the head of
such agency shall be authorized to make the purchase or repair. Total purchases so made shall only be for
the purpose of meeting needs created by the emergency situation. In the event such executive head is
responsible to an agency board, at the meeting next following the emergency
purchase, documentation of the purchase, including a description of the
commodity purchased, the purchase price thereof and the nature of the emergency
shall be presented to the board and placed on the minutes of the board of such
agency. The head of such agency, or his
designee, shall, at the earliest possible date following such emergency
purchase, file with the Department of Finance and Administration (i) a
statement explaining the conditions and circumstances of the emergency, which
shall include a detailed description of the events leading up to the situation
and the negative impact to the entity if the purchase is made following the
statutory requirements set forth in paragraph (a), (b) or (c) of this section,
and (ii) a certified copy of the appropriate minutes of the board of such
agency, if applicable. On or before September
1 of each year, the State Auditor shall prepare and deliver to the Senate Fees,
Salaries and Administration Committee, the House Fees and Salaries of Public
Officers Committee and the Joint Legislative Budget Committee a report
containing a list of all state agency emergency purchases and supporting
documentation for each emergency purchases.

(k)
Governing authority emergency
purchase procedure. If the
governing authority, or the governing authority acting through its designee,
shall determine that an emergency exists in regard to the purchase of any
commodities or repair contracts, so that the delay incident to giving
opportunity for competitive bidding would be detrimental to the interest of the
governing authority, then the provisions herein for competitive bidding shall
not apply and any officer or agent of such governing authority having general
or special authority therefor in making such purchase or repair shall approve
the bill presented therefor, and he shall certify in writing thereon from whom
such purchase was made, or with whom such a repair contract was made. At the board meeting next following the
emergency purchase or repair contract, documentation of the purchase or repair
contract, including a description of the commodity purchased, the price thereof
and the nature of the emergency shall be presented to the board and shall be
placed on the minutes of the board of such governing authority.

(l)
Hospital purchase, lease-purchase
and lease authorization.

(i) The commissioners or board of trustees of any public hospital may
contract with such lowest and best bidder for the purchase or lease-purchase of
any commodity under a contract of purchase or lease-purchase agreement whose
obligatory payment terms do not exceed five (5) years.

(ii) In addition to the authority granted in subparagraph (i) of this
paragraph (l), the commissioners or board of trustees is authorized to enter
into contracts for the lease of equipment or services, or both, which it
considers necessary for the proper care of patients if, in its opinion, it is
not financially feasible to purchase the necessary equipment or services. Any such contract for the lease of equipment
or services executed by the commissioners or board shall not exceed a maximum
of five (5) years' duration and shall include a cancellation clause based on
unavailability of funds. If such
cancellation clause is exercised, there shall be no further liability on the
part of the lessee. Any such contract
for the lease of equipment or services executed on behalf of the commissioners
or board that complies with the provisions of this subparagraph (ii) shall be
excepted from the bid requirements set forth in this section.

(i) Purchasing agreements
approved by department. Purchasing
agreements, contracts and maximum price regulations executed or approved by the
Department of Finance and Administration.

(ii) Outside equipment repairs. Repairs to equipment, when such repairs are
made by repair facilities in the private sector; however, engines,
transmissions, rear axles and/or other such components shall not be included in
this exemption when replaced as a complete unit instead of being repaired and
the need for such total component replacement is known before disassembly of
the component; however, invoices identifying the equipment, specific repairs
made, parts identified by number and name, supplies used in such repairs, and
the number of hours of labor and costs therefor shall be required for the
payment for such repairs.

(iii) In-house equipment
repairs. Purchases of parts for
repairs to equipment, when such repairs are made by personnel of the agency or
governing authority; however, entire assemblies, such as engines or
transmissions, shall not be included in this exemption when the entire assembly
is being replaced instead of being repaired.

(iv) Raw gravel or dirt. Raw unprocessed deposits of gravel or fill
dirt which are to be removed and transported by the purchaser.

(v) Governmental equipment
auctions. Motor vehicles or other
equipment purchased from a federal agency or authority, another governing
authority or state agency of the State of Mississippi, or any governing
authority or state agency of another state at a public auction held for the
purpose of disposing of such vehicles or other equipment. Any purchase by a governing authority under
the exemption authorized by this subparagraph (v) shall require advance
authorization spread upon the minutes of the governing authority to include the
listing of the item or items authorized to be purchased and the maximum bid
authorized to be paid for each item or items.

(vi) Intergovernmental sales
and transfers. Purchases, sales,
transfers or trades by governing authorities or state agencies when such
purchases, sales, transfers or trades are made by a private treaty agreement or
through means of negotiation, from any federal agency or authority, another
governing authority or state agency of the State of Mississippi, or any state
agency or governing authority of another state. Nothing in this section shall permit such purchases through
public auction except as provided for in subparagraph (v) of this section. It is the intent of this section to allow
governmental entities to dispose of and/or purchase commodities from other
governmental entities at a price that is agreed to by both parties. This shall allow for purchases and/or sales
at prices which may be determined to be below the market value if the selling
entity determines that the sale at below market value is in the best interest
of the taxpayers of the state.
Governing authorities shall place the terms of the agreement and any
justification on the minutes, and state agencies shall obtain approval from the
Department of Finance and Administration, prior to releasing or taking
possession of the commodities.

(vii) Perishable supplies or
food. Perishable supplies or foods
purchased for use in connection with hospitals, the school lunch programs,
homemaking programs and for the feeding of county or municipal prisoners.

(viii) Single source items. Noncompetitive items available from one (1)
source only. In connection with the
purchase of noncompetitive items only available from one (1) source, a
certification of the conditions and circumstances requiring the purchase shall
be filed by the agency with the Department of Finance and Administration and by
the governing authority with the board of the governing authority. Upon receipt of that certification the
Department of Finance and Administration or the board of the governing
authority, as the case may be, may, in writing, authorize the purchase, which
authority shall be noted on the minutes of the body at the next regular meeting
thereafter. In those situations, a
governing authority is not required to obtain the approval of the Department of
Finance and Administration.

(ix) Waste disposal facility
construction contracts.
Construction of incinerators and other facilities for disposal of solid
wastes in which products either generated therein, such as steam, or recovered
therefrom, such as materials for recycling, are to be sold or otherwise
disposed of; however, in constructing such facilities, a governing authority or
agency shall publicly issue requests for proposals, advertised for in the same
manner as provided herein for seeking bids for public construction projects,
concerning the design, construction, ownership, operation and/or maintenance of
such facilities, wherein such requests for proposals when issued shall contain
terms and conditions relating to price, financial responsibility, technology,
environmental compatibility, legal responsibilities and such other matters as
are determined by the governing authority or agency to be appropriate for
inclusion; and after responses to the request for proposals have been duly
received, the governing authority or agency may select the most qualified
proposal or proposals on the basis of price, technology and other relevant
factors and from such proposals, but not limited to the terms thereof,
negotiate and enter contracts with one or more of the persons or firms
submitting proposals.

(x) Hospital group purchase
contracts. Supplies, commodities
and equipment purchased by hospitals through group purchase programs pursuant
to Section 31-7-38.

(xi) Information technology
products. Purchases of information
technology products made by governing authorities under the provisions of
purchase schedules, or contracts executed or approved by the Mississippi
Department of Information Technology Services and designated for use by
governing authorities.

(xii) Energy efficiency services
and equipment. Energy efficiency
services and equipment acquired by school districts, community and junior
colleges, institutions of higher learning and state agencies or other
applicable governmental entities on a shared-savings, lease or lease-purchase
basis pursuant to Section 31-7-14.

(xiii) Municipal electrical
utility system fuel. Purchases of
coal and/or natural gas by municipally-owned electric power generating systems
that have the capacity to use both coal and natural gas for the generation of
electric power.

(xiv) Library books and other
reference materials. Purchases by
libraries or for libraries of books and periodicals; processed film, video
cassette tapes, filmstrips and slides; recorded audio tapes, cassettes and
diskettes; and any such items as would be used for teaching, research or other
information distribution; however, equipment such as projectors, recorders,
audio or video equipment, and monitor televisions are not exempt under this
subparagraph.

(xv) Unmarked vehicles. Purchases of unmarked vehicles when such
purchases are made in accordance with purchasing regulations adopted by the
Department of Finance and Administration pursuant to Section 31-7-9(2).

(xvii) Multichannel interactive
video systems. From and after July
1, 1990, contracts by Mississippi Authority for Educational Television with any
private educational institution or private nonprofit organization whose
purposes are educational in regard to the construction, purchase, lease or
lease-purchase of facilities and equipment and the employment of personnel for
providing multichannel interactive video systems (ITSF) in the school districts
of this state.

(xviii) Purchases of prison
industry products. From and after
January 1, 1991, purchases made by state agencies or governing authorities involving any item that is manufactured,
processed, grown or produced from the state's prison industries.

(xix) Undercover operations
equipment. Purchases of
surveillance equipment or any other high-tech equipment to be used by law
enforcement agents in undercover operations, provided that any such purchase
shall be in compliance with regulations established by the Department of
Finance and Administration.

(xx) Junior college books for
rent. Purchases by community or
junior colleges of textbooks which are obtained for the purpose of renting such
books to students as part of a book service system.

(xxi) Certain school district
purchases. Purchases of commodities
made by school districts from vendors with which any levying authority of the
school district, as defined in Section 37-57-1, has contracted through
competitive bidding procedures for purchases of the same commodities.

(xxiii) Municipal water tank
maintenance contracts. Professional
maintenance program contracts for the repair or maintenance of municipal water
tanks, which provide professional services needed to maintain municipal water
storage tanks for a fixed annual fee for a duration of two (2) or more years.

(xxiv) Purchases of Mississippi
Industries for the Blind products.
Purchases made by state agencies or governing authorities involving any
item that is manufactured, processed or produced by the Mississippi Industries
for the Blind.

(xxv) Purchases of state-adopted
textbooks. Purchases of state-adopted
textbooks by public school districts.

(xxvi) Certain purchases under
the Mississippi Major Economic Impact Act.
Contracts entered into pursuant to the provisions of Section 57-75-9(2)
and (3).

(xxvii) Used heavy or specialized
machinery or equipment for installation of soil and water conservation
practices purchased at auction.
Used heavy or specialized machinery or equipment used for the
installation and implementation of soil and water conservation practices or
measures purchased subject to the restrictions provided in Sections 69-27-331 through
69-27-341. Any purchase by the State
Soil and Water Conservation Commission under the exemption authorized by this
subparagraph shall require advance authorization spread upon the minutes of the
commission to include the listing of the item or items authorized to be
purchased and the maximum bid authorized to be paid for each item or items.

(xxviii) Hospital lease of equipment or services. Leases by hospitals of equipment or services
if the leases are in compliance with subparagraph (l)(ii).

(xxix) Purchases made pursuant to qualified
cooperative purchasing agreements.
Purchases made by certified purchasing offices of state agencies or
governing authorities under cooperative purchasing agreements previously
approved by the Office of Purchasing and Travel and established by or for any
municipality, county, parish or state government or the federal government,
provided that the notification to potential contractors includes a clause that
sets forth the availability of the cooperative purchasing agreement to other
governmental entities. Such purchases
shall only be made if the use of the cooperative purchasing agreements is
determined to be in the best interest of the government entity.

(n)
Term contract authorization. All contracts for the purchase of:

(i) All contracts for the purchase of commodities, equipment and
public construction (including, but not limited to, repair and maintenance),
may be let for periods of not more than sixty (60) months in advance, subject
to applicable statutory provisions prohibiting the letting of contracts during
specified periods near the end of terms of office. Term contracts for a period exceeding twenty-four (24) months
shall also be subject to ratification or cancellation by governing authority
boards taking office subsequent to the governing authority board entering the
contract.

(ii) Bid proposals and contracts may include price adjustment clauses
with relation to the cost to the contractor based upon a nationally published
industry-wide or nationally published and recognized cost index. The cost index used in a price adjustment
clause shall be determined by the Department of Finance and Administration for
the state agencies and by the governing board for governing authorities. The bid proposal and contract documents
utilizing a price adjustment clause shall contain the basis and method of
adjusting unit prices for the change in the cost of such commodities, equipment
and public construction.

(o)
Purchase law violation
prohibition and vendor penalty. No
contract or purchase as herein authorized shall be made for the purpose of
circumventing the provisions of this section requiring competitive bids, nor
shall it be lawful for any person or concern to submit individual invoices for
amounts within those authorized for a contract or purchase where the actual
value of the contract or commodity purchased exceeds the authorized amount and
the invoices therefor are split so as to appear to be authorized as purchases
for which competitive bids are not required.
Submission of such invoices shall constitute a misdemeanor punishable by
a fine of not less than Five Hundred Dollars ($500.00) nor more than One
Thousand Dollars ($1,000.00), or by imprisonment for thirty (30) days in the
county jail, or both such fine and imprisonment. In addition, the claim or claims submitted shall be forfeited.

(p)
Electrical utility petroleum-based
equipment purchase procedure. When
in response to a proper advertisement therefor, no bid firm as to price is
submitted to an electric utility for power transformers, distribution
transformers, power breakers, reclosers or other articles containing a
petroleum product, the electric utility may accept the lowest and best bid
therefor although the price is not firm.

(q)
Fuel management system bidding
procedure. Any governing authority
or agency of the state shall, before contracting for the services and products
of a fuel management or fuel access system, enter into negotiations with not
fewer than two (2) sellers of fuel management or fuel access systems for
competitive written bids to provide the services and products for the
systems. In the event that the
governing authority or agency cannot locate two (2) sellers of such systems or
cannot obtain bids from two (2) sellers of such systems, it shall show proof
that it made a diligent, good-faith effort to locate and negotiate with two (2)
sellers of such systems. Such proof
shall include, but not be limited to, publications of a request for proposals
and letters soliciting negotiations and bids.
For purposes of this paragraph (q), a fuel management or fuel access
system is an automated system of acquiring fuel for vehicles as well as
management reports detailing fuel use by vehicles and drivers, and the term
"competitive written bid" shall have the meaning as defined in
paragraph (b) of this section.
Governing authorities and agencies shall be exempt from this process
when contracting for the services and products of a fuel management or fuel
access systems under the terms of a state contract established by the Office of
Purchasing and Travel.

(r)
Solid waste contract proposal
procedure. Before entering into any
contract for garbage collection or disposal, contract for solid waste
collection or disposal or contract for sewage collection or disposal, which
involves an expenditure of more than Fifty Thousand Dollars ($50,000.00), a
governing authority or agency shall issue publicly a request for proposals
concerning the specifications for such services which shall be advertised for
in the same manner as provided in this section for seeking bids for purchases
which involve an expenditure of more than the amount provided in paragraph (c)
of this section. Any request for
proposals when issued shall contain terms and conditions relating to price,
financial responsibility, technology, legal responsibilities and other relevant
factors as are determined by the governing authority or agency to be
appropriate for inclusion; all factors determined relevant by the governing
authority or agency or required by this paragraph (r) shall be duly included in
the advertisement to elicit proposals.
After responses to the request for proposals have been duly received,
the governing authority or agency shall select the most qualified proposal or
proposals on the basis of price, technology and other relevant factors and from
such proposals, but not limited to the terms thereof, negotiate and enter
contracts with one or more of the persons or firms submitting proposals. If the governing authority or agency deems
none of the proposals to be qualified or otherwise acceptable, the request for
proposals process may be reinitiated.
Notwithstanding any other provisions of this paragraph, where a county
with at least thirty-five thousand (35,000) nor more than forty thousand
(40,000) population, according to the 1990 federal decennial census, owns or
operates a solid waste landfill, the governing authorities of any other county
or municipality may contract with the governing authorities of the county owning
or operating the landfill, pursuant to a resolution duly adopted and spread
upon the minutes of each governing authority involved, for garbage or solid
waste collection or disposal services through contract negotiations.

(s)
Minority set aside authorization. Notwithstanding any provision of this
section to the contrary, any agency or governing authority, by order placed on
its minutes, may, in its discretion, set aside not more than twenty percent
(20%) of its anticipated annual expenditures for the purchase of commodities
from minority businesses; however, all such set-aside purchases shall comply
with all purchasing regulations promulgated by the Department of Finance and
Administration and shall be subject to bid requirements under this section. Set-aside purchases for which competitive
bids are required shall be made from the lowest and best minority business
bidder. For the purposes of this
paragraph, the term "minority business" means a business which is
owned by a majority of persons who are United States citizens or permanent
resident aliens (as defined by the Immigration and Naturalization Service) of
the United States, and who are Asian, Black, Hispanic or Native American,
according to the following definitions:

(i) "Asian" means persons having origins in any of the
original people of the Far East, Southeast Asia, the Indian subcontinent, or
the Pacific Islands.

(ii) "Black" means persons having origins in any black
racial group of Africa.

(iii) "Hispanic" means persons of Spanish or Portuguese
culture with origins in Mexico, South or Central America, or the Caribbean
Islands, regardless of race.

(iv) "Native American" means persons having origins in any
of the original people of North America, including American Indians, Eskimos
and Aleuts.

(t)
Construction punch list
restriction. The architect,
engineer or other representative designated by the agency or governing
authority that is contracting for public construction or renovation may prepare
and submit to the contractor only one (1) preliminary punch list of items that
do not meet the contract requirements at the time of substantial completion and
one (1) final list immediately before final completion and final payment.

(u)
Purchase authorization
clarification. Nothing in this
section shall be construed as authorizing any purchase not authorized by law.

SECTION 4. This act shall take effect and be in force
from and after July 1, 2004.